With a variety of rate increases this yesterday morning, SallieMae Bank is continuing to keep its product line APYs competitive. While the individual rate increases haven’t been exceptional, the cumulative effect has kept SallieMae Bank within striking distance of the rate leaders.

Money Market Account

The Money Market Account (MMA) continues to be SallieMae Bank’s most competitive deposit account with its current 2.20% APY. There have been nine rate increases since the beginning of the year, adding a total of 88 bps to the MMA APY.

APY

MIN

MAX

INSTITUTION

PRODUCT

DETAILS

2.20%

-

-

Sallie Mae Bank

Money Market

Rates as of January 21, 2019.

The MMA has no monthly service fee and can be opened with as little as $1. While there is no minimum or maximum balance requirement for SallieMae Bank’s MMA,

if you open an Account that remains dormant, with a balance of $100 or less with no activity for the past 12 months, we reserve the right to close the Account.

SallieMae Bank’s MMA offers check writing, unlike some other so-called MMAs, like Capital One's 360 Money Market (2.00% APY) or CIT Bank's Money Market Account (1.85% APY). Checks are provided at no cost if they are ordered when the MMA is opened; any check order placed after account opening will cost $5. There is also a $10 Excessive Transaction Fee for each item beyond the limit of six transactions per month.

If you repeatedly exceed this limit, we’re required to close your account(s).

SallieMae Bank’s product line is atypical, in that its high-rate account is the MMA (2.20% APY), rather than the High-Yield Savings account (2.10% APY). While the MMA and High-Yield Savings are similarly structured with no tiers or fees, the MMA's check writing ability gives it a distinct edge: when withdrawing a large amount, the money will keep earning a top rate until the check has posted and settled. As a DA colleague said, “that’s often a reason banks offer higher rates on their savings account, rather than on their MMAs.”

Complete details about the MMA (including POD account information) are available on Deposit Account Terms and Conditions Agreement page, including information on SallieMae Bank’s transfer service. While the ACH transfer service has several nice features, such as the ability to handle large transfers, the one downside is long hold times. When an ACH deposit of over $5k is made via SallieMae Bank's transfer service, the hold time for the amount over $5k is 10 business days.

High-Yield Savings

Following yesterday’s rate increase, the High-Yield Savings now earns 2.10% APY on all balances. Since January, the High-Yield Savings has had eight rate increases, adding a total of 110 bps.

APY

MIN

MAX

INSTITUTION

PRODUCT

DETAILS

2.10%

-

-

Sallie Mae Bank

High-Yield Savings

Rates as of January 21, 2019.

The High-Yield Savings has no minimum opening deposit or minimum balance requirement, but a dormant account (a balance of $100 or less with no activity for the past twelve months) may be closed. There is also an Excessive Transaction Fee of “$10 for each item that exceeds the maximum number (6) of transactions.”

SallieMae Bank CDs

SallieMae Bank also raised the rates on three of its CDs, but the new APYs fall well short of the current rate leaders. The minimum deposit for any of the CDs is $2.5k, with no stated balance cap.

If your CD has a term of 12 months or less, the penalty will be equal to 90 days’ simple interest.

If your CD has a maturity term greater than 12 months, the penalty will be equal to 180 days’ simple interest.

Thanks to DA reader, buckeye61, for another informative Forum post about SallieMae Bank.

Availability

Headquartered in Salt Lake City, Utah, SallieMae Bank is an “pure” internet bank, with no brick-and-mortar branches. Accounts may be opened by individuals who have a Taxpayer Identification Number (usually a Social Security Number) and a physical address in the United States. Opening any account, including CDs, Money Market, and Savings accounts, must be done online.

Bank Overview

SallieMae Bank has an overall health rating of "A+" at DepositAccounts.com, with a Texas Ratio of 1.42% (excellent) based on June 30, 2018 data. In the past year, SallieMae Bank has increased its total non-brokered deposits by $1.17 billion, an excellent annual growth rate of 15.97%. Please refer to our financial overview of SallieMae Bank (FDIC Certificate # 58177) for more details.

The "SallieMae" brand is most often associated with private student loans. The Student Loan Marketing Association (aka SallieMae) opened its doors as a Government-Sponsored Enterprise (GSE), designed to support the guaranteed student loan program created by the Higher Education Act of 1965. Chartered in 2005, the internet-only SallieMae Bank has expanded its product line beyond student loans to include CDs, Savings Accounts, Money Market Accounts, Insurance, and Credit Cards, and today has assets in excess of $24 billion, with more than $17.1 billion in deposits.

Great Bank! Yes, there are a handful of nationally available banks and credit unions with higher rates, but as I have pointed out many times 10-25 basis points will not translate into much additional interest for individuals with modest deposit amounts. I tend to look at a bigger picture when choosing a bank. Quality of the website, and banking services and products are important to me. Sallie Mae has been consistently competitive with their rates on all three of their products(Money Market/Savings/CD) and that is in addition to great customer service, website navigation and fees. Having said that, if I had hundreds of thousands to deposit I would probably "Rate chase" as well.

I had a Sallie MAE account years ago. They would give me a 10% bonus towards upromise which would go t my daughter's college 529 fund. They ended that program and their rates were no longer competitive so I moved on. Nice to see they are competitive now but I'm getting 2.5% at ESEB and sometimes the balance account can be large while I decide what investments to make other cash needs. When I can earn 1/4% more I move my savings account. I won't move to a new savings account if I don't like the limitations.

Sallie Mae and Discover bank are among the few banks where the savings and money market account rates are comparable. 2.1 vs. 2.2 and 1.85 vs. 2.0 percent. So what is it with Ally, Synchrony, and Capital One Banks?

As I’ve stated in earlier blog posts, SallieMae Bank has continued to increase the rates on its Money Market account, High-Yield Savings account, and several CDs since beginning of the year. While the individual rate increases haven’t been exceptional, the cumulative effect has kept SallieMae Bank within striking distance of the rate leaders.

SallieMae Bank has been busy increasing rates since beginning of the year. There's been enough rate change activity to warrant 15 blog posts and Forum posts about the Money Market account, the High-Yield Savings account, and several CDs. While the individual rate increases haven’t been wow-worthy on their own, the cumulative effect is keeping SallieMae Bank at the front of the rates peloton.

DA readers that follow the bi-weekly CD Rates Summary may have noticed that Sallie Mae Bank’s CDs weren’t included in this week’s issue. They were removed in the May 22 Summary because the APYs were too low. With a round of rate increases this week, Sallie Mae Bank CDs are once again competitive, with the 24-month CD offering the best APY....

As DA reader, Buckeye61, noted in a Forum post this morning, Sallie Mae Bank has bumped up several of their rates. Just like last month's rate increases, the new APYs aren’t stellar, but they certainly keep Sallie Mae Bank in the hunt.

Money Market Account

With its new 1.75% APY, the Money Market Account (MMA) continues to be Sallie Mae Bank’s most competitive deposit account. Since the beginning of the year, a...

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